Rent-A-Center this past week scored a legal victory at the U.S. Supreme Court for businesses that rely on the fine print of employee arbitration agreements to stave off litigation.

The Supreme Court ruled against plaintiff Antonio Jackson, who filed suit against Rent-A-Center West, a division of Plano-based Rent-A-Center. Jackson alleged he was dismissed because of racial discrimination.

When Jackson filed the lawsuit, Rent-A-Center enforced an arbitration agreement he had signed, saying he had agreed — based on terms of the contract — that in all disputes, an arbitrator would decide if the case goes to court. Jackson pushed to get out of the contract.

In its 5-4 ruling, the Supreme Court sided with Rent-A-Center and said an arbitrator should decide whether Jackson leaves arbitration.

“The court decided that an arbitrator has the authority to decide challenges to an arbitration agreement so long as the parties to the agreement say so clearly,” said Rent-A-Center’s attorney, Rob Friedman, of the Littler law firm in Dallas.

Friedman said he believes the Supreme Court reaffirmed its “support for arbitration in the employment context.”

Audrey Mross, a labor and employment attorney with Munck Carter LLP in Dallas, said the case “reinforces the prevailing tendency of the courts to respect what Congress enacted in the Federal Arbitration Act to honor the parties’ intent to resolve their employment disputes via arbitration.”

Public Citizen Litigation Group attorney Deepak Gupta said the court’s decision sets the Supreme Court on a collision course with congressional lawmakers who are now promoting the Arbitration Fairness Act to push back on corporations that use arbitration agreements to quash consumer and employee lawsuits. Gupta was on the team of attorneys representing Jackson.

He said the court made its decision by interpreting the narrow meaning of a clause in the contract — one that neither side argued.

“It’s always a surprise when a court reaches a decision based on an argument that wasn’t presented by one of the parties,” Gupta said. He added that such a decision “is a mark of activism” on the court’s part.

As a result of this decision, Gupta said companies that draft arbitration agreements will closely follow the Rent-A-Center ruling.

“The pros and cons of a decision like this very much depend upon whether you believe arbitration or a court proceeding is the best means to resolve a dispute, and reasonable people can disagree about that,” Mross said.

“Even those who aspire toward the quicker decision and lowered costs that arbitration is supposed to provide have to admit that outcome is not guaranteed in every instance,” she added.